THE IMPACT OF GLOBALIZATION

from the booklet

Blue Gold

The global water crisis and the commodification
of the world's water supply

A Special Report issued by the International
Forum on Globalization (IFG)

by Maude Barlow
National Chairperson, Council of Canadians
Chair, International Forum on Globalization (IFG) Committee
on the Globalization of Water

EVERYTHING FOR SALE

The dominant development model of our time is economic globalization,
a system fueled by the belief that a single global economy with
universal rules set by corporations and financial markets is inevitable.
Economic freedom, not democracy or ecological stewardship, is
the defining metaphor of the post-Cold War period for those in
power. As a result, the world is going through a revolutionary
transformation as great as any in history. The most direct result
of economic globalization to date is a massive transfer of economic
and political power away from national governments into the hands
of the bureaucracies they helped to create. At the heart of this
transformation is an all-out assault on virtually every sphere
of life.

Everything is for sale, even those areas of life once considered
sacred, such as health and education, culture and heritage, genetic
codes and seeds, and natural resources such as air and water.
Increasingly, these services and resources are controlled by a
handful of transnational corporations who shape national and international
law to suit their interests. The Washington-based Institute for
Policy Studies reports that the top two hundred corporations are
now so big that their total sales surpass the combined economies
of 182 countries and they have almost twice the economic clout
of the poorest four-fifths of humanity. Of the 100 largest economies
in the world, 53 are now transnational corporations.

A new global royalty now centrally plans the market, destroying
lives and nature in its wake. Says writer and former senior advisor
to the U.S. Agency for International Development (USAID) David
Korten, "The world is now ruled by a global financial casino
staffed by faceless bankers and hedge fund speculators who operate
with a herd mentality in the shadowy world of global finance.
Each day, they move more than two trillion dollars around the
world in search of quick profits and safe havens, sending exchange
rates and stock markets into wild gyrations wholly unrelated to
any underlying economic reality. With abandon they make and break
national economies, buy and sell corporations and hold politicians
hostage to their interests."

UNEQUAL ACCESS

A striking feature of economic globalization is the widening
gap between rich and poor; an entrenched underclass is being created
between regions and within every society in the world. The 2000
United Nations Human Development Report says that the disparity
in the level of income between the top 20 percent and the bottom
20 percent of the world's population is 150:1 and has doubled
in the last 30 years. The world's 225 richest individuals have
a combined wealth equal to the annual income of half of humanity.
The three richest people in the world have assets that exceed
the combined gross domestic product of 48 countries.

The richest fifth of the world's people consumes 86 percent
of all goods and services, while the poorest fifth consumes just
over 1 percent. Americans and Europeans spend substantially more
every year on pet food, reports the United Nations, than the total
money needed to provide basic health and nutrition for everyone
in the world. Americans spend more money on cosmetics every year
than the total amount needed to provide basic universal education.

It is no surprise, then, that the deep inequality sustained
by economic globalization, whether intentional or not, is dramatically
affecting the poor's access to water, the most basic of life's
rights. The United Nations Economic and Social Commission on Sustainable
Development says that fully three-quarters of the population living
under conditions of water stress-amounting to 26 percent of the
total world population-are located in developing countries. By
2025, the Commission projects, those low-income countries experiencing
water stress will amount to 47 percent of the total world population.

In highly populated Asian, African and Latin American countries,
massive increases in animal and human waste, intensified with
the arrival of factory farms, are exposing more and more people
to cholera and the deadly E. coli bacteria through contaminated
water supplies. Most local governments cannot even afford basic
chlorine to treat the water. Many local communities previously
turned to aquifers and hand pumps to get around the problem of
polluted surface water, now chemical and human waste seeping into
these sources has rendered the water table dangerous as well.
In Third World cities, it is now common to ration water to neighbourhoods
for a few hours a day or a few days a week.

The United Nations reports that Europeans spend $11 billion
a year on ice cream, $2 billion more than the estimated total
money needed to provide clean water and safe sewers for the world's
population. More than five million people, most of them children,
die every year from illnesses caused by drinking poor quality
water. While billions go without clean water, North Americans
use 1,300 gallons of water per person every day.

But water inequality exists within societies as well. In 1994,
when Indonesia was hit with a major drought, residents' wells
ran dry, but Jakarta's golf courses, which cater to wealthy tourists,
continued to receive 1,000 cubic meters per course per day. In
1998, in the midst of a three-year drought that dried up river
systems and further depleted aquifers, the Cyprus government cut
the water supply to farmers by 50 percent while guaranteeing the
country's two million tourists a year all the water they needed.
In South Korea, farmers south of Seoul recently armed themselves
with hoes and blocked municipal water trucks from pumping water
for city dwellers in fear it would leave their crops wanting.

Anne Platt of Worldwatch Institute reports that a family in
the top fifth income groups in Peru, the Dominican Republic, or
Ghana is respectively, three, six, or twelve times more likely
to have water connected by pipe to the home than a family in the
bottom fifth in those countries. Because they lack access to publicly
subsidized utilities, says Platt, the poor often end up paying
more for their water than do the rich because they must obtain
it from illegal sources or private vendors.

In Lima, Peru, for instance, poor people may pay a private
vendor as much as $3 for a cubic meter of water, which they must
then collect by bucket and which is often contaminated. The more
affluent, on the other hand, pay 30 cents per cubic meter for
treated water provided through the taps in their houses. Hillside
slum dwellers in Tegucigalpa, the capital of Honduras, pay substantially
more for water supplied by private tankers than they would even
if they paid for the government to install a water pipe. In Dhaka,
Bangladesh, squatters pay water rates that are twelve times higher
than what the local utility charges. In Lusaka, Zambia, low-income
families pay, on average, half their household income on water.

Indigenous people have been impacted in a particularly brutal
fashion by economic globalization and the theft of their water.
It is the immediate relationship that indigenous people have to
water that makes them especially vulnerable to any large-scale
project that alters aquatic ecosystems. The massive hydroelectric
projects of northern Quebec were devastating to the local Cree
First Nations as well as to the caribou and fish upon which they
depend.

Environmental writer Josh Karliner explains "Indeed the
process of globalization is steamrolling social and financial
support for the basic rights of the poor, increasingly shunting
the disenfranchised off to the side, where they must fend for
themselves in the brutally competitive 'market'. Growing numbers
of people are becoming victims of globalization, as the forces
of corporate expansion move into farmlands, deserts, oceans and
river systems they previously ignored. Already poor but largely
self-sufficient, communities across the earth are being cast into
deeper social and ecological poverty, as well as cultural dislocation,
as their resources are appropriated for the seemingly insatiable
demands of the world's ever growing consumer societies."

Once recognized as a basic human right, water is now denied
to huge numbers of the human family. Wise conservation of water
cannot take place until the reality of inequality is confronted-and
the reality of inequality cannot be confronted until the tenets
of economic globalization are rejected.

PROHIBITING PRESERVATION

Globalization creates economic and political structures that
make an ecologically sound economy entirely impossible. Economic
globalization refers to the integration of national economies
into a single unified market. Transnational corporations pressure
national governments to privatize, deregulate, eliminate trade
and investment "barriers," boost exports, and generally
relinquish state controls over the economy in order to create
one global economy.

Such economic integration unleashes new levels of industrial
production, intensifying natural resource exploitation and exacerbating
all existing environmental problems. Heightened competition forces
governments to roll back environmental protections in order to
increase the competitiveness of their domestic producers and attract
foreign investment. Economic activities that are ecologically
sustainable are punished by deregulated market forces, making
responsible management a liability that decreases competitiveness.

"Globalization creates political and economic structures
whose patterns of production and consumption are both ecologically
and socially destructive," says Victor Menotti, director
of the International Forum on Globalization's Committee on the
Environment. "All activity orients around exports, which,
to be globally competitive, require centralized control over vast
natural resources, the ability to access large amounts of finance
capital, and the need to operate complex mega-technologies. Fewer
workers are needed, so great numbers of people are left watching
as local resources they once tended are now shipped away to others."

The result is a regime that contradicts the very principles
of ecologically sustainable economics removing control over the
land from people who live on it, discouraging strong regulatory
protections, penalizing responsible management, and making impossible
the task of getting the price right.

As nature is increasingly commodified, governments all over
the world are dismantling environmental legislation or allowing
industry to police itself. Countries are lowering corporate taxes
and environmental regulations in order to remain competitive,
the primary mandate of the new economy. As a result, governments
are left with reduced fiscal capacity to reclaim polluted waterways
and build infrastructure to protect water; at the same time they
are also left with reduced regulatory capacity to prevent further
pollution.

Globalization's imperative of unlimited growth makes it impossible
for participating countries to make water preservation a priority.
Non-industrial countries have restructured their economic systems
to pay their debt and export their way to prosperity, destroying
both natural ecosystems and environmental regulations in the bargain.
The massive abuse and pollution of the internal waterways of most
developing countries has been one price of belonging to the global
economy. The depletion of underground aquifers and rivers to supply
the water demand of transnational industry is another.

Intrusive technologies, including the massive transportation
systems needed to carry out global trade, damage water systems
as well. Roads carved out of wilderness destroy river and lake
habitats as well as forests; increased global shipping multiplies
the amount of waste dumped directly into oceans and lakes; and
dredging for port and waterway construction destroys coastal habitat.

China has started work on a gargantuan $1 billion project
to divert water from the Yangtze River to Beijing. Ten thousand
workers have almost finished drilling a 420 kilometer series of
tunnels to drain water from the middle stretch of the Yangtze,
where it will either be sent through a high-mountain range, or
through a new 1,230-kilometer channel to water-starved cities
like Taiyuan on its way to the capital- a prospect the Worldwatch
Institute compares to turning the Mississippi River to service
Washington, D.C.

The governments of several South American countries have temporarily
put a hold on the creation of a mammoth new water system that
would channel 3,400 kilometers of the Paraguay and Parana rivers
for industrial use and open up the interior of the continent to
global trade. But environmentalists aren't celebrating yet; they
know there are huge corporate interests at stake and they will
not easily give up on this project.

"Given current corporate practices," says businessman
and environmentalist Paul Hawken, "not one wildlife reserve,
wilderness, or indigenous culture will survive the global economy.
We know that every natural system on the planet is disintegrating.
The land, water, air, and sea have been functionally transformed
from life-supporting systems into repositories for waste. There
is no polite way to say that business is destroying the world."

Not everyone is so gloomy about the world water crisis. After
all, what some see as an ecological nightmare of unprecedented
proportions, a growing number of private investors are seeing
as a golden market opportunity.